Price Feed
Price Displayed on Extra Dapp
The price displayed, and users' position/debt/equity value on ExtraFi DApp are directly based on the on-chain price of Velodrome (Calculated by the constant product invariant).
Liquidation Price
Liquidation triggers use the Time Weighted Average Price (TWAP) calculated over a 30-minute period.
(Learn more about TWAP)
By utilizing TWAP, the system ensures that positions are more resilient and better protected, particularly in highly volatile markets. This safeguard is designed to shield leverage farmers from sudden price fluctuations or malicious manipulations, reducing the risk of flash liquidation events.
Price Protection with Chainlink Price Feed
Chainlink price feeds (for assets supported on Optimism) are also aggregated on ExtraFi DApp - it is used to avoid abnormal price fluctuation: only when the price difference among 'TWAP', 'current on-chain price', and 'Chainlink Feed' is under a reasonable threshold will the liquidation mechanism work - If there is abnormal price fluctuation, the transaction will be reverted to avoid price attacks.
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